You just won a $2M government contract. The contracting officer signed, the notice to proceed is in your inbox, and the champagne's on ice.
Then the first bill comes due — and it's not the government's.
Before you can invoice a single dollar of that award, you're paying: payroll for the crew you just hired, deposits on subcontractors, insurance certificates, equipment, maybe a badging or clearance process, maybe travel and lodging if the work is out of your home market. Government agencies don't advance funds against a contract — they pay for work already performed, after you invoice it, on their schedule. Which means there's a real, unavoidable stretch — call it the mobilization gap — where money goes out before you're allowed to bill a dollar in.
Most contractors know this gap exists. What catches them off guard is where the money to cover it is supposed to come from — because it's usually already spoken for.
Ask most contractors "what's your cash position?" and they'll answer with a number. Ask "how much of that is actually free right now?" and it gets quieter.
If you're using a factoring facility, a meaningful slice of your receivables is sitting in reserve — released only after the debtor pays in full, weeks after you thought the invoice was "done." If you're not factoring, you're simply waiting the 30, 45, 60+ days government agencies take to pay the last invoice you issued. Either way, the capital tied to the contract you just finished — or are still finishing — hasn't come home yet.
So when the new contract's mobilization bill lands, you're not choosing between spending it or saving it. You're choosing between spending money you don't have yet, and money that's still legally, structurally, or operationally parked on a different job.
This is the part that surprises contractors who assume factoring is a general-purpose cash flow fix: factoring can only monetize an invoice that already exists.
No invoice, nothing to sell. And there's no invoice for the mobilization phase of a new contract — no billable work has happened yet. A factor can advance you cash the day after you invoice the government. It cannot advance you cash the day before you've done anything to invoice.
That gap — hire-to-first-invoice — is exactly where growth gets capped. Not because you can't do the work. Because you can't afford the two-to-six weeks of outgoing cash it takes to reach the point where you're even allowed to bill for it.
It's worse if your factoring facility is the same one carrying your last contract. Borrowing bases are capped against your receivables. Reserves on the prior job reduce what's available today. Minimum-volume or whole-ledger terms can mean your facility is already committed before the new contract's mobilization costs ever show up. The tool that's supposed to free up capital can, in practice, be the reason none is free.
Every factoring pitch — including the good ones — answers the same question: how fast can you turn an invoice into cash? That's a real problem, and factoring solves it reasonably well.
But it's the wrong question if you're standing at the start of a new award. The question that actually determines whether you can perform the contract you just won is: do I have capital access at the moment I win — not weeks after I first bill?
Nobody selling factoring is incentivized to answer that question, because the honest answer is "not from us."
Two things have to be true to survive the mobilization gap without stalling growth:
1. The capital from your last contract needs to come home fast enough to be free again. A settlement measured in days, on a flat fee that doesn't erode the longer an invoice takes to clear, does more for your next mobilization than a reserve-holdback structure that trickles cash back to you weeks after the "advance."
2. You need to see the gap coming before you sign, not after. Pricing and proposal support that flags the mobilization cost of a bid — staffing ramp, bonding capacity, insurance, subcontractor deposits — during capture, not after award, is the only way to walk into a new contract already knowing what it costs to start it.
This is the piece traditional factoring will never sell you, because it isn't a financing product — it's the work of actually helping a contractor get ready to perform, before the first invoice exists.
Winning the contract was never the hard part for most of the contractors we work with. Affording the six weeks between the win and the first payment — while the capital from the last win is still someone else's timeline to release — is.
At Vendors First, invoices settle in about 72 hours, so the capital from your last contract comes home fast enough to actually fund your next one — and our RFP and pricing support means you see the mobilization gap coming during capture, not after you've already spent into it.
Fix that gap, and the growth ceiling isn't capability. It's whatever contract you're ready to go win next.